| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| - | - | - |
QV Investors navigated a volatile Q1 2026 marked by U.S. and Israeli attacks on Iran that disrupted global energy markets, sending Brent crude from $72 to $104 and raising stagflationary concerns. The firm maintained its fundamental research approach, making selective portfolio adjustments across strategies. The Canadian small cap team recycled capital from takeout successes into existing positions including Cargojet, while the global equity team benefited from an early Haliburton position established before the energy shock. Technology stocks faced pressure from AI displacement concerns, creating opportunities in quality names like Rightmove. The team trimmed overvalued positions like Toromont Industries and reinvested in undervalued quality such as Intact Financial. Fixed income positioning emphasized flexibility through higher-rated corporate bonds as credit spreads widened. Private credit market concerns intensified given rapid asset growth reminiscent of pre-financial crisis conditions. The manager emphasizes preparedness for continued volatility while maintaining long-term focus on fundamental value creation rather than attempting to predict geopolitical outcomes.
QV Investors advocates for maintaining a fundamental research framework and long-term mindset during periods of uncertainty, focusing on sound security selection and intentional diversification rather than attempting to predict unpredictable geopolitical outcomes.
The range of outcomes has widened as new risks have increased. It remains unclear how the Iran conflict will be resolved, and a long-lasting energy shock could force an economic setback. The manager emphasizes maintaining a fundamental research framework and long-term mindset while being prepared for volatility through flexibility in positioning.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 10 2026 | 2026 Q1 | CJT.TO, HAL, IFC.TO, RMV.L, TIH.TO | AI, Canada, energy, Geopolitical, private credit, small cap, technology, value |
CJT.TO HAL RMV.L TIH.TO IFC.TO |
QV Investors maintained disciplined fundamental investing through Q1 2026 geopolitical volatility that spiked oil prices and pressured technology stocks. The firm recycled capital from overvalued positions into undervalued quality names like Cargojet and Intact Financial while establishing energy exposure through Haliburton. Management emphasizes long-term value creation over geopolitical prediction amid widening outcome ranges. |
| Jan 12 2026 | 2025 Q4 | 005930.KS, 0700.HK, BABA, CAT, CNI, DG, FTT.TO, GOOGL, MU, NVDA, TPZ.TO, UNP | AI, commodities, Dollar, financials, gold, international, Market Concentration, value |
005930 KS DG FTT CN TPZ CN |
Market leadership is rotating from expensive US tech to undervalued international markets, commodities, and financials. AI spending shifted to hardware providers while gold surged 64%. Record US market concentration and high valuations signal lower future returns. QV sees opportunities in defensive sectors, European cyclicals, and small caps trading at attractive multiples, favoring active over passive strategies. |
| Oct 8 2025 | 2025 Q3 | TOU.TO | Canada, Employment, Natural Gas, Quality, Rate Cuts, risk management, valuation | - | QV warns of deteriorating North American employment data masked by dangerous market euphoria, with S&P 500 at 22.8x forward earnings suggesting poor future returns. The firm emphasizes quality investing through balance sheet strength and risk management over return maximization, positioning for resilience as economic uncertainty rises while market multiples offer little margin for error. |
| Jul 9 2025 | 2025 Q2 | MCD, V, WBA | consumer, Dollar, Fragility, Risk Appetite, Trade Policy, Valuations, volatility | - | US markets at 23x P/E create fragility masquerading as strength, with consumption dependent on wealthy stock owners creating dangerous feedback loops. QV protected capital during April's trade war selloff but sees structural risks building. AI and fiscal stimulus could fuel temporary melt-up, but low margin of safety makes markets vulnerable to shocks. Non-US markets offer better value. |
| Jan 8 2025 | 2024 Q4 | NVDA | AI, Concentration, growth, Market Commentary, momentum, technology, Valuations | - | QV Investors warns that despite strong 2024 performance driven by mega-cap tech, current extreme market concentration and high valuations create conditions for potential disappointment. While AI investment may drive future productivity, unprecedented capital expenditure with uncertain returns mirrors historical boom-bust cycles. The firm maintains balanced positioning to compound returns with lower valuation risk. |
| Jul 10 2024 | 2024 Q2 | AAPL, AMZN, AVGO, BRK-A, GOOGL, LLY, META, MSFT, NVDA, POOL, SBUX | AI, consumer, credit, Economic Cycle, Market Concentration, rates, Risk Appetite, Valuations | - | QV Investors sees dangerous bubble conditions with extreme market concentration, deteriorating consumer fundamentals, and excessive speculation. Nvidia drives one-third of S&P returns while most stocks decline. Rising delinquencies and trade-down behavior contrast with soft landing consensus. Historical valuations and 17% earnings expectations echo past bubbles. Firm maintains defensive value approach. |
| Jan 10 2024 | 2023 Q4 | AAPL, AMZN, GOOGL, META, MSFT, NVDA, TSLA | Quality, rates, Recession, risk management, Sentiment, value | - | QV warns that despite 2023's strong market performance driven by Magnificent 7 stocks, multiple late-cycle indicators suggest elevated recession risk while valuations offer little margin for error. Their value-oriented approach underperformed growth-heavy benchmarks but positions them well for either rising rates or economic weakness, emphasizing capital preservation over speculation. |
| Jul 7 2023 | 2023 Q2 | - | AI, Canada, inflation, monetary policy, risk management, technology, Valuations, value | - | QV sees a dangerously narrow bull market driven by AI hype in mega-cap tech stocks, while economic late-cycle indicators suggest caution. With extreme valuation spreads between expensive and cheap stocks at historic highs, the firm finds compelling opportunities in unloved areas like Canadian and international equities, maintaining diversified positioning focused on quality businesses with strong balance sheets. |
| Apr 6 2023 | 2023 Q1 | ARKK, TSLA | Canada, Fed policy, inflation, interest rates, Regional Banks, Risk Appetite, Valuations | - | Markets rebounded strongly in Q1 2023 despite deteriorating fundamentals, with risk-seeking behavior returning as investors anticipated Fed policy pivot. However, sticky inflation, restrictive monetary policy, regional bank crisis, and elevated valuations create narrow path forward. Economic indicators suggest caution with weakening consumer and manufacturing activity pointing to potential earnings disappointment ahead. |
| Jan 6 2023 | 2022 Q4 | - | - | - | |
| Oct 7 2022 | 2022 Q3 | - | - | - | |
| Jul 8 2022 | 2022 Q2 | - | - | - | |
| Apr 8 2022 | 2022 Q1 | - | - | - |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
OilThe effective closure of the Strait of Hormuz led to sharp price spikes in global energy markets, with Brent crude climbing from $72 to $104 by end of March. This historically rare price shock raised inflationary concerns and stagflationary risks, particularly for energy importing nations in Asia and Europe. Energy stocks have been clear beneficiaries of higher crude oil prices, leading to sharp sector rotation. |
Energy Crude Inflation Geopolitical Supply |
AITechnology stocks have been under pressure due to concerns about overinvestment in artificial intelligence data center capacity and displacement of software-as-a-service businesses by evolving AI capabilities. AI fears have pressured shares of companies like Rightmove lower, though the manager believes AI innovations are likely to unlock greater value rather than being restrictive to growth outlook. |
Technology Data Centers Software Innovation Disruption | |
Private CreditConcerns in the fast-growing private credit market have accelerated in recent months. Private credit assets have doubled in the past six years alone, with echoes of the U.S. mortgage market leading up to the great financial crisis. Recent investor withdrawals from various private credit funds highlight the liquidity demarcation between private and public fixed income. |
Credit Liquidity Risk Issuance Withdrawals | |
| 2025 Q4 |
AIAI narrative shifted from Magnificent 7 to hardware providers building data centers. Memory chip providers like Micron and Samsung surged 240% and 120% respectively. Industrial businesses like Caterpillar and Finning benefited from AI-related capital spending for power generation equipment. |
Data Centers Memory Infrastructure Hardware Semiconductors |
GoldGold prices rose 64% during the year as global central banks bolstered reserves and individual investors sought store of value amid geopolitical and trade concerns. Rising gold prices supported outperformance of Canadian and international markets over US equities. |
Precious Metals Store of Value Central Banks Geopolitical Risk | |
FinancialsEuropean financials rose 65.7% in 2025 as positive interest rates re-ignited profitability. Canadian bank stocks rose 43.4% as falling central bank rates caused yield curve to steepen. Over five years, European financials returned 111.5% versus S&P 500's 82.3%. |
Banks Interest Rates Yield Curve Europe | |
EnergyEnergy stocks underperformed S&P 500 by 76% in last three years despite strong free cash flow and balance sheets. QV purchased Topaz Energy Corp at attractive 7% free cash flow yield with mid-single digit organic production growth potential. |
Oil Free Cash Flow Royalties Undervaluation | |
RailroadsTransport volumes in recession since summer 2022 among trucking and railroads. QV holdings Canadian National Railway and Union Pacific trade at reasonable valuations and near record discounts to broader market, with ability to leverage volume and pricing power over fixed cost base. |
Transportation Volume Recovery Fixed Costs Pricing Power | |
| 2025 Q3 |
Natural GasTourmaline Oil Corp exemplifies quality management in the natural gas sector, maintaining low leverage and strong free cash flow generation despite commodity price volatility. The company operates with one of the lowest cost structures in the energy producer industry and has grown into Canada's largest natural gas producer through strategic acquisitions. |
Natural Gas Energy Free Cash Flow Acquisitions Cost Structure |
QualityQV emphasizes multi-faceted quality attributes including lean balance sheets, sustainable debt levels, and cycle-minded management teams. Quality businesses deserve premiums over time, but starting valuations matter significantly for future returns. The firm maintains focus on balance sheet strength and financial flexibility as competitive advantages. |
Balance Sheet Debt Management Financial Flexibility Competitive Advantage Safety Margin | |
Risk AppetiteMarket sentiment has driven valuation expansion despite softening economic data, with investors willing to pay near-record prices without broad-based earnings growth. QV emphasizes risk management over return maximization during periods of elevated market multiples and political uncertainty, focusing on portfolio resilience rather than chasing market momentum. |
Valuation Market Sentiment Risk Management Portfolio Resilience Market Multiples | |
| 2025 Q2 |
ValuationsUS market trading at 23x P/E, historically extreme levels that typically lead to lower returns with excess volatility. Market valuation remained far above typical bear market troughs even after April decline, with S&P 500 P/E only falling to 19x versus 15.7x in 2022 bear market. |
P/E Multiples Risk Premium Bear Market Volatility |
Trade PolicyTrade war uncertainty sent global stock markets on wild ride in Q2, with S&P 500 approaching bear market territory in early April before staging sharp recovery as investors rapidly discounted tariff impacts on global economy. |
Tariffs Trade War Global Economy Market Volatility Policy Uncertainty | |
Risk AppetiteMarkets have been fueled by speculation since April bottom, with investors dumping money into unprofitable companies and short-term trends. Rampant trading on margin, option trading, and pervasive buy-the-dip mentality create potential fragility masquerading as strength. |
Speculation Margin Trading Options Buy-the-dip Market Structure | |
| 2024 Q4 |
AITechnology companies are investing unprecedented amounts in AI development, with $234 billion in capex planned for 2025. This represents a nuclear arms race between tech titans competing for control of this nascent market opportunity. However, Sequoia Capital estimates $600 billion in revenue is required to pay back current AI spending, while ChatGPT's run-rate revenue was only $3.4 billion in mid-2024. |
Artificial Intelligence Capex Technology Revenue Investment |
ValuationsU.S. market concentration and aggregate valuations have rarely been so uniformly high. The S&P 500 trades at 22x P/E versus a long-term average of 16x. Even with optimistic assumptions of 12% earnings growth through 2030, only 5% annual price returns would be implied at normal valuations. Current high valuations create ripe conditions for unexpected losses and unsatisfactory outcomes. |
Price Earnings Market Concentration Returns Risk Multiples | |
MomentumThe Magnificent Seven stocks rose 48% while the other 493 S&P 500 stocks rose just 10%. U.S. value stocks underperformed growth stocks by another near-record 21%. Market concentration has risen to the highest in modern history with among the fewest number of stocks outperforming the broader market since the tech bubble. |
Growth Concentration Outperformance Technology Dispersion | |
| 2024 Q2 |
AIAI-driven bull market continues with Nvidia driving significant market returns. Seven AI-related stocks drove the entire S&P 500 return in Q2. Current AI enthusiasm parallels historical tech bubble patterns with extreme concentration and high expectations. |
Nvidia Semiconductors Tech Bubble Market Concentration Earnings Growth |
Trade DownConsumers increasingly trading down to lower-priced goods and avoiding large discretionary purchases. Pool construction expected to fall 15-20% in 2024. Starbucks volumes declined and dining trends approaching stall speed as consumers curtail spending. |
Consumer Spending Discretionary Pool Corp Starbucks Retail | |
Credit StressCredit card delinquency rates continue to deteriorate while consumer confidence surveys show expectations for future conditions deteriorating by the widest amount in over 30 years. Housing affordability at lowest levels in over 20 years. |
Delinquencies Consumer Credit Housing Affordability Consumer Confidence | |
RatesBank of Canada and European Central Bank began lowering rates in Q2. Federal Reserve likely to follow by year end. Rate cutting cycles typically arise in response to economic deterioration and often accompany tail end of economic cycles. |
Federal Reserve Rate Cuts Central Banks Economic Cycle | |
Risk AppetiteRetail investors heavily exposed to stocks with quarterly purchases surging from under $10 billion to $70 billion since 2020. Inflows into triple-leveraged ETFs up 3x from 2023 lows. Trading in speculative penny stocks averaging 3% of volume in 2024. |
Retail Investors Leveraged ETFs Speculation Meme Stocks Penny Stocks | |
ValuationsCurrent valuations remain historically high with CAPE ratios suggesting muted 10-year return outlook. Market multiples near historical highs leave little margin for error if economic picture diverges from optimistic expectations. |
CAPE Market Multiples Historical Highs Return Outlook | |
| 2023 Q4 |
ValueQV emphasizes risk-conscious value investing as an attractive environment, noting their strategies offer meaningful valuation advantages to the broad stock market. They believe this represents the early stages of a multi-year opportunity for value-conscious investors that began in fall 2020. |
Value Risk Management Valuation Quality Defensive |
RatesThe yield curve has been inverted for 18 months, with real yields near highest levels since 2007. QV expects the yield curve will eventually steepen through central bank rate cuts or rising long-term rates, positioning their strategies for either scenario. |
Interest Rates Yield Curve Fed Policy Real Yields Duration | |
Risk AppetiteQV identifies elevated investor sentiment with strong inflows into risky leveraged ETFs, record options speculation, and professional equity exposure near prior peaks. They view current bullishness as suggesting optimistic outcomes may already be priced into many stocks. |
Sentiment Speculation Options ETFs Bullishness | |
| 2023 Q2 |
AIExcitement surrounding artificial intelligence has rapidly reignited market sentiment for businesses expected to benefit from this nascent megatrend. While AI will create meaningful long-term growth opportunities, many developments remain relatively distant promises and AI likely lies somewhere in the initial arc of a classic technology hype cycle. |
Technology Hype Cycle Growth Megatrend Valuations |
InflationInflation continued to decline but forces of inflation may not be truly conquered. Geopolitical instability, onshoring trends, tight labor markets, and persistent wage growth suggest inflation could retreat into temporary dormancy rather than being permanently vanquished. The market expects inflation to revert to long-term averages, but this consensus view may prove incorrect. |
Monetary Policy Wages Onshoring Commodities Geopolitical | |
ValueThere is an extreme spread between valuations of low P/E stocks and high P/E stocks, with high P/E stocks trading at over 27x earnings while low P/E stocks trade at just 11x earnings. This 17.3x spread is well above the historical average of 11.7x, highlighting an unusually attractive opportunity set for value-conscious investors. |
P/E Ratios Opportunity Spreads Cheap Attractive | |
| 2023 Q1 |
InflationHeadline inflation declining towards 6% in US and 5% in Canada, but sticky measures like services, wages and rent remain elevated. Fed attempting to thread the needle between controlling inflation and maintaining employment while avoiding economic damage. |
Monetary Policy Fed Interest Rates Services Wages |
RatesFed increased rates 0.25% in March, marking 4.75% total increase since 2022 - tied for sharpest in Fed's 108-year history. Yield curve reached most negative level since 1981, signaling restrictive policy and deteriorating economic outlook. |
Fed Funds Yield Curve Treasury Monetary Policy Quantitative Tightening | |
Regional BanksSilicon Valley Bank failure in March sparked panic and deposit exodus at regional banks. Crisis appears settled but lasting impacts include higher funding costs, reduced competitiveness, and credit crunch as banks tighten lending standards. |
Credit Crunch Deposits Lending Standards Bank Crisis Financial System | |
Risk AppetiteStrong Q1 rebound with tech-heavy Nasdaq 100 entering bull market, rising 20%. Growth stocks outperformed with resurgence of risk-seeking behavior despite deteriorating fundamentals. Short-dated call option volumes on Tesla and ARKK reached highs surpassing 2021 euphoria. |
Growth Stocks Options Bull Market Speculation Volatility |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| Apr 10, 2026 | Fund Letters | QV Investors | HAL | Halliburton Company | Oil & Gas Equipment & Services | Oil & Gas Equipment & Services | Bull | New York Stock Exchange | capital allocation, contrarian, energy, Free Cash Flow, oilfield services, Value | Login |
| Apr 10, 2026 | Fund Letters | QV Investors | RMV.L | Rightmove PLC | Internet Content & Information | Interactive Media & Services | Bull | New York Stock Exchange | AI innovation, Data Business, digital platform, market share, proprietary data, Real Estate, UK | Login |
| Apr 10, 2026 | Fund Letters | QV Investors | TIH.TO | Toromont Industries Ltd. | Industrial Distribution | Trading Companies & Distributors | Neutral | New York Stock Exchange | AI data centers, CIMCO, Heavy Equipment, profit-taking, Refrigeration, Valuation Management | Login |
| Apr 10, 2026 | Fund Letters | QV Investors | IFC.TO | Intact Financial Corporation | Insurance - Property & Casualty | Property & Casualty Insurance | Bull | New York Stock Exchange | Auto Insurance Cycle, Canada, global diversification, Mispriced Quality, Property & Casualty Insurance | Login |
| Apr 10, 2026 | Fund Letters | QV Investors | CJT.TO | Cargojet Inc. | Integrated Freight & Logistics | Air Freight & Logistics | Bull | New York Stock Exchange | Air Cargo, Canada, Contracted Services, Domestic Franchise, Inflation Protection, market share, Transportation, Value | Login |
| Jan 12, 2026 | Fund Letters | Mathew Hermary | DG | Dollar General Corporation | Consumer Staples | Discount Stores | Bull | New York Stock Exchange | Discountretail, Margins, recovery, turnaround, valuation | Login |
| Jan 12, 2026 | Fund Letters | Mathew Hermary | TPZ CN | Topaz Energy Corp. | Energy | Oil & Gas Royalties | Bull | New York Stock Exchange | cashflow, dividends, energy, Optionality, Production, royalties, valuation | Login |
| Jan 12, 2026 | Fund Letters | Mathew Hermary | FTT CN | Finning International Inc. | Industrials | Trading Companies & Distributors | Bull | New York Stock Exchange | AI, CapEx, Cyclicality, Equipment, infrastructure, rerating, valuation | Login |
| Jan 12, 2026 | Fund Letters | Mathew Hermary | 005930 KS | Samsung Electronics Co., Ltd. | Information Technology | Semiconductors & Electronic Equipment | Bull | New York Stock Exchange | AI, Memory, rerating, semiconductors, valuation | Login |
| TICKER | COMMENTARY |
|---|---|
| CJT.TO | The Canadian small cap team has been adding to some of the strategy's existing positions including Cargojet Inc., with shares that have incrementally cheapened as its international transport services have underperformed expectations recently. Its domestic air cargo franchise remains robust and continues to hold a 90%+ market share in Canada. The majority of its flight services are under contract, providing inflation passthrough protection, earnings stability and growth in shareholder distributions. Its lower valuation provides a margin of safety should cyclical headwinds become a larger factor. At the same time, the current share price offers an attractive valuation for this growing air cargo transport business. |
| HAL | Fortunately, our global equity team established a position in oilfield services provider Haliburton in early January. The investment thesis was centered on a low valuation and strong free cash flow generation, despite what was expected then to be sluggish end market demand for its services. Management's capital allocation discipline was a decisive factor as the team planned for efficiencies to free up additional cash flow for improved shareholder return activity. The shares have benefited from the higher energy price backdrop since then, but the thesis was not reliant on the supply shock. |
| RMV.L | The global small cap team purchased a business that was caught up in the AI displacement scare during the quarter. Rightmove PLC is a market share leading digital platform that facilitates 80%+ real estate activity in the United Kingdom. At its core, Rightmove is a data business in the UK real estate market with decades of proprietary data and sufficient scale to innovate and maintain its lead position. AI fears have pressured its shares lower, opening up an attractive entry point as the team believes its data integrity and AI innovations are likely to unlock greater value add, rather than being restrictive to its growth outlook. |
| TIH.TO | A side beneficiary of the AI boom has been Toromont Industries, an Eastern-based heavy equipment dealer in the Canadian equity strategy. The promise of strong end market demand for its refrigerant cooling business (CIMCO) from overheated AI centers lifted its shares to a level that warranted a trim to manage valuation risk. |
| IFC.TO | Proceeds were reinvested in areas that offer better value, such as the shares of Intact Financial. The team has been increasing its position in Intact as concerns of a tougher auto insurance cycle in the U.S. have weighed on its valuation, despite it not having material exposure in U.S. auto insurance. Intact remains a globally diversified and best-in-class P&C insurer. Its current valuation presents another opportunity for mispriced quality. |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
|---|---|---|---|---|---|
| No Recent Buys Data | |||||
| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| No Recent Sells Data | ||||||
| Industry | Prev Quarter % | Current Quarter % | Change |
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| No industry data available | |||
